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TaeKwonDood writes with a followup to the news we discussed over the weekend about tariffs being places on Chinese solar panels. He writes,
"According to Forbes, 'Solar power is booming. Imports from China were a tepid $21 million in 2005, but in 2011 installations totaled nearly $2.7 billion. That's a huge win. And just as advocates for solar power had hoped, a larger market drove down prices. Solar energy cost has declined by two-thirds in the last four years, meaning it will soon start to close in on fossil fuels.' There's just one problem: now the government wants to kill it. The article continues, 'As the market was flooded by both silicon (from silicon producers) and thin-film panels (by Chinese manufacturers), the price for thin-film panels came crashing down – along with Solyndra’s business model. ... Yet that isn’t the only instance of mismanagement. The whole clean energy program remains flawed, even at the consumer level. The people who are the most likely to be impacted by high energy prices, the poor, are the least likely to benefit from the solar rebate scheme because they lack the capital to pay for the installation.'"

Probably because you can recognize horseshit when you smell it. Apparently, this article's author has never heard of solar lease programs, which are intended for precisely that market. Instead of paying money to the power company, you pay a lower power bill to a company that sticks panels on your roof (and presumably reaps the profits if production exceeds your usage). There's usually zero up-front cost, and these programs are readily available in many places.

There is one market where solar is becoming a must, and that is RV-ing. With all the electric-hungry appliances that are running off 12 volts, coupled with the fact that batteries take a long time to come up to full charge, solar is becoming a must have for anyone with a RV who isn't just staying on an RV park's shore power 24/7/365. With rigs getting larger, there is plenty of space to add panels.

Add to this flexible solar panels that can be rolled up, and I can envision someone able to run appliances like the A/C or microwave off a battery bank that is recharged by the solar panels on the ceiling, awning, and perhaps an extended room.

So, for RV-ers, it is something that allows for the comforts of home without having to break out the generator.

Have you been to a non-electrified camping ground that allows RVs? People who drive huge vehicles towing huge campers and sometimes an extra vehicle, ATV or boat achieving a paltry 8-13mpg have absolutely no qualms about breaking out the gasoline generators.

They can't leave the comforts of home behind, including the noise and smog.

Indeed. Here in California, I have had representatives of three different companies knock on my door and try to convince me to let them install free solar panels on my roof. We have tiered energy pricing, and solar only makes sense for people who use enough energy to bump them into the 30 cent tier. I don't use enough, so they leave as soon as I show them my monthly electricity bill.

We just talked to a sales rep from Verango, they do just this type of system. Sunrun buys the panels and maintains them. Quoted us 27.5 cents/kwh to start in the first year to replace the 131%+ tier power that we are charged higher rates in California on.

I created a spreadsheet to calculate our average cost/kwh over the last year in the upper tiers, and it worked out to 32.5 cents. So we could save 5 cents/kwh, or $31 per month if our usage stayed the same the last year. Not enough for me to bite, even if it costs us nothing. I'd rather find ways to reduce usage and cut our bill by more than that. We'd planned on doing that, which means the savings would be even smaller because our usage in the top tiers would be going down anyway.

Incidentally, part of his pitch is that energy costs increase 6.9% per year. The 20 year solar contract locks in increases of 2.9%. So part of the argument is that over time, solar costs will go up at a much slower pace than electricity costs from PG&E. The only thing is, there has apparently been so much outrage over electricity costs in California that last year they got the highest tier rates lowered from around 40.4 cents/kwh to 34.2 cents/kwh, and the next highest tier also had a decrease from around 33 cents/kwh to around 31 cents/kwh. (Baseline and 101-130% tier rates went up a little) Which kind of negates the argument that energy costs go up every year, and reinforces the fact that energy companies are regulated by the government, so there are ultimately some political factors involved (aside from market forces, etc) in determining rates that are charged.

It's really tricky though. We are massively subsidizing our domestic solar industry as well to enable production at below the true cost because we care about it as a means of domestic energy production. In the end import taxes are not going to make up for the fact that it's cheaper and more efficient to make some of these things overseas now. Are the chinese playing fair? Probably not. Does it really matter in the long run? Probably not.

On the one hand they scream (after MASSIVELY SUBSIDIZING their puppetmasters in the big oil companies and the corn lobby) about the subsidization of companies like Solyndra. They do this ignoring the fact that it didn't work because China was engaging in dumping and any trade with China is fundamentally unfair trade due to Chinese environmental-destruction and slave-labor practices.

Then they complain about how Solar power is "not financially viable", and likewise for wind, geothermal, and pretty much every other renewable resource we've got. The Republicans gave the corn lobby a massive gift when Dumbya's administration outlawed MTBE and forced 10% corn ethanol into gas nationwide, despite the fact that corn ethanol is a net loss of energy (1.8 units used for every 1 unit produced) to make. The subsidization of the oil industry is orders of magnitude larger than any subsidization we've ever given to clean power.

It's like when 50 years ago the Democrats became beholden to the Teamsters; in came big trucking and the subsidized interstate system, meanwhile rail shipping - far more energy efficient for long distances - got fucked up the ass having to eat the costs of maintaining the rail lines unsubsidized.

If you see a government policy that's fucked up on energy, follow the money. Chances are, this decade there's a Koch hand behind it - the decade you choose you may find someone else.

The interstates were Eisenhower's idea, after he tried to travel cross country on 1920-era roads (a near impossible task), and decided to copy Germany's autobahns. I don't know why you place the credit on Democrats.

>>>when Dumbya's administration outlawed MTBE

Yeah. Outlawing poison. What a horrible thing to do. President Idiot deserves a lot of blame for stupid stuff, but this is not one of them.

One thing that really gets me, there are enough geothermal hot-spots in the US to provide a huge amount of power, especially if the R&D were funded like drilling in the 60's and 70's. Even better, we've already got a huge amount of operational know-how and technology from that very investment that could be adapted to geothermal power use. The basic hole drilling technology is the same, and only small modifications would be needed to bring us around to closed cycle steam/water loops and we already know how to turn hot steam in to electrical power.

corn ethanol is a net loss of energy (1.8 units used for every 1 unit produced) to make.

I'm not the biggest fan of corn ethanol, but this is a very outdated myth from a study in the early 1970s that people keep repeating. We've gotten much more efficient and corn ethanol is now 1.5 to 1.8 units produced for every 1 unit of energy put in. That's still way worse than most other biofuels, but it isn't a net energy loss.

I find it very hard to believe stove-sized nuclear reactors would every be allowed in the U.S. There's just too many reasons it wouldn't be permitted. 1. Terrorist threat. 2. Hardware hackers/modders. 3. (Most importantly) Opposition by power companies who would stand to lose out BIG on such things.

Imagine if people could buy a nuclear power cell for their homes and offices?! Holy cow! It would drive conventional grid power down to bare minimum rates. Power company executives might have to move into

The people who are the most likely to be impacted by high energy prices, the poor, are the least likely to benefit from the solar rebate scheme because they lack the capital to pay for the installation.

While I'm not big of the idea of "the long tail" or "trickle down economics", I would think this would help the poor in a small manner. By those able to afford it having solar panels, the power companies have less demand for their energy and so the poor are less likely to see an increase in power prices (and, rarely, a slight reduction). This is, of course, assuming things like the able don't have their own, separate power station from the poor, enough able people install them to actually make some sort of dent, etc.

Even if they get no impact from it, "the poor still can't afford them" doesn't seem like a valid mark against such a program; I didn't see anyone complaining that the tax breaks to those who bought hybrids were bad because the poor still couldn't afford hybrids.

Photo-voltaic panels are not cheap enough or efficient enough to be a truly economic means of producing electricity. The subsidies potentially enable economies of scope and scale to the point where it would be economical. Long way to go though still.

I'm not talking about the able/rich or power plants producing electricity from solar for the poor, I'm talking about decreased demand on the power plants due to the able/rich not needing as much because of their own solar panels. I'm no power station expert, but less stress on the plant likely means lower overall costs which could be passed on to the remaining customers in the form of slight reduction in cost (or, much more likely in my pessimistic mind, a delay in the rising of costs.)

Or an increase in costs, because thanks to lots of users running solar panels there is now far more variation in demand...Sure the demand on hot sunny days might be lower, but during the hours of darkness it will be just as high as it ever was, so you still need to keep the same capacity available in the coal/gas/nuclear plants.

Not too long of a way to go. Basically they need to get the panels + installation down another 25-50% (and technologically this is not insurmountable) but in addition to that, they have to do so with something resembling a respectable profit margin. RIght now companies are running things close to the wire trying to compete, and that's not sustainable on a financial plane.

Of course, if the price of competing energy goes up (if there is a recoveing economy, it will) then that makes the competitive point for solar easier to acheive. In some local markets, solar is already cheaper.

Basically they need to get the panels + installation down another 25-50%

A good way to do this is to standardize the mounting brackets, and then change building codes so the brackets are required to be pre-installed on all newly constructed buildings. As prices drop, they can install the panels cheaply because the brackets are already there. This will be much cheaper than retrofitting panels onto an existing roof.

Firstly to address the article, one is a start-up loan guarantee to offset the risks in surmounting what is a huge barrier to entry, the other is a continued subsidy to aid an established industry. Sure they're both in the same vein of using public funds to bolster industry, but not quite comparable beyond that, are they? Continued subsidy of established industry is one of the major arguments made by those who are against US agricultural subsidies, and they make a reasonable point regarding the negative impact it has to the outside world. Many countries feel justified to place tariffs on US agricultural products because of this.

Now to address your post, let's look at the not so apparent inconsistency in the rhetoric surrounding the motivations behind the subsidy. If the Chinese government indeed only wanted to make renewable energy more affordable for the average Chinese person, as many say is the sole motivation, it could very well have implemented a tax rebate policy with low-income allowances for Chinese consumers (as it's typically done in the US, at least the rebate part) -- and if fearing the money drain to imported panels, they could even have made "for use on domestically made panels only" a condition for such rebates/allowances. Under such a policy, imported solar panels would find it difficult to compete in the Chinese market, but it wouldn't be as big of a deal. That's not what happened. By continuing to subsidize the already established manufacturers directly, it places anti-competitive behavior behind the rather more difficult-to-assail rhetoric of "making energy affordable for the average Chinese person." Unfortunately, this rhetorical sleight of hand is able to misdirect many people.

Well doing that would still be anti-competitive, less so than directly subsidizing the manufacturers since it doesn't really affect exports, but anti-competitive nonetheless. If the US did it, I'm sure other countries would definitely complain, but if it did it as a retreat from direct subsidies, it may be seen as an easier pill to swallow (hmm, that's giving me evil conspiracy ideas haha). In the US, Japanese hybrid cars are the most popular. This is because rebates are less biased, and they stimulate a se

Precisely. Consider what happened with water in my area; we entered a conservation phase, and they promptly jacked up the water rates "to ensure minimum funding to maintain the system." Water conservation phase ended, usage increased and... hey look the rate stayed the fucking same.

Reminds me of seasonal gas price hiking. Nothing to do with politics, everything to do with greedy-ass oil execs and Saudi princes.

To the government that the US can no longer sustain a competitive domestic solar panel industry. This was predicted in shockingly accurate detail by HBS researchers 3 years ago. [hbr.org] Protectionism is only going to make it worse -- amazing that these ideas still fly.

What's the other option? Let China do the same they done with rare earth metals? Factories and mining operations takes time to setup, especially with the red tape that exists in the US. Cheap panels now can mean expensive panels later (or worst, supply shortages). The free market only works when both sides are trying to maximize profit. While generally true, China, who has a heavy hand in it's economy, can easy change things to benefit China at the cost of less profit.

The US designs stuff, now? Pretty much everything in my house is designed by a Japanese or Thai or Korean company. A US company might have designed the basic idea for some of it more than 60 years ago, but nothing new or interesting comes out of America today.

False. If Chinese solar companies started raping us with price, then a new company (located in EU, US, India, Korea, or even China itself) will rise-up and sell the panels for less.

Spoken like somebody who has no understanding of engineering at all and learned about business from political screeds. Somebody's going to invest the money in complex high tech manufacturing plants to compete with a monopolist who can undercut his prices any time it wants?

You seem to think actual experience and practical know-how aren't factors in competitiveness. That's to be a common American delusion these days, that money capital can conjure intellectual capital out of thin air. The killer advantage Chi

I do not see the anomaly. the market for solar power cells was not driven by any big need for solar power production, and so it all hinged on subsidies to the producers, be they the producers of solar infrastructure or the installers/managers. Moreover, when the size of the market was small the impact on energy bills at the wider level was negligible, like having a 0.01c tax surcharge.

Fast forward to today, and things are quite expectedly different: the installed base is BIG, the subsidies are a botload of money, and the shift between the have and havenots has widened. On the "have" side, big producers of energy receiving subsidies, which given the expenditure were well off to start with, all the infrastructure managers (politician), and the lobbyists who have to be paid to make sure the merry go round keeps going. On the "have not" side, traditional energy producers and especially network managers, who have to justify the expenditures required to adjust to a wildly varying power source (backup generators, more transmission lines, etc); small businesses and individuals, who do not have the clout to say that they do not want or can afford to pay money on top of electricity simply because someone goofed ten years back. And goofed they did: If the level of subsidies would be cut to the level rendering viable only the latest and cheapest generation of solar plants, the "stranded asset" problem would be enormous, since may if not all of the older plants would tank. the saving grace for the old solars is simple and crude: since most of the installations were financed through bank loans, and banks are the "little princes" of western governments, non one will force the situation, unless the taxpayers really get upset.

I mean, they're nice and if you can get them, do it. But! I went off-grid in '80 or so, when subsidies were hard to find, solar was $7/watt for panels or more, and it still paid off. I just doubled what I have here so as to have enough extra to charge my new Volt too - and it's a pretty big deal to just tell the gasoline man to get lost entirely - more panels is also more times the house system needs no backup. Finally there. !00% NOT Chinese stuff, though I have no axe to grind with them as a people. I just prefer poly xtal big, thick, reliable, conservative cells, that's all - I've got them 30 years old at still 80% of original spec. Even those are down to 3.50/watt or so now, made in USA if you care (I don't much, I'm just trying to get the most kWh/buck). It was hard at first, but built good habits of no waste, and now its fantastic - and no monthly bills...just internet.
I got a much better subsidy thusly - I bought raw land and homesteaded on it. Power companies are in a lot of places, in charge of enforcing the building permit and inspections regimes. So, if you're not and never become a customer - well, my buildings are taxed as barns and sheds even though I obviously live here.
In today's tax environment - lookee, no property taxes to speak of.

Having known and worked with a number of people in the alternative energy industry I can assure you that they've long since stopped being scrappy little upstarts. They're big business and even big oil has entered alternative industry. They're not stupid. They know there's a ton of money in the industry and a massive amount more to be made.

As for the Chinese, they do have a propensity for dumping goods on other countries. It's something the EU has responded a number of times in the past. And of course a lot

It's already reaching the limits of theoretical efficiency given the current harvesting mechanism. And yet it's not profitable. Money isn't just some abstraction. It represents resources which go into production and distribution of the thing. If it's not profitable, then it's an environmental as well as financial net loss. More resources go in than come out. If something cannot be made profitable even at peak efficiency, it represents a net waste of natural resources.

It's not profitable if you are trying to make money by selling the energy you make from it.

But I dont give a rats ass about that. I use it to reduce my expenses. I make up 50% of my electrical use in solar. I hope to increase that in the next 4 years to be 110% of my electrical use in solar.

Why 110%? so I can have a reserve, maybe even be wasteful. I might shoot for 150% and buy an electric hot tub.

The companies selling quality panels are doing just fine. In fact they are quite profitable. What is not

I hear this same argument all the time here in Anguilla where I live. "we don't want solar unless it reduces the cost of electricity for the poor man".It's nonsense because solar is not going to drop the wholesale price of electricity, the differential from the price of NG or Nuke is never going to be substantial enough. Electricity in America is very very cheap. There is little point in trying to reduce the cost further, it is mostly administration charges at this stage.

The reason countries like the USA and other are promoting solar is because it is a renewable source. OIl and other fossil fuels are filthy and news of their imminent demise is not exaggerated. They will run out. America has a responsibility as a first world nation to reduce emissions.

Turning to renewable sources allows more time before the end of oil and for the technologies to develop. You can't expect we can transition once there is a crisis. Unless we start now and incentivize the use of RE, we will never get to a point where we can manage without fossil fuels. Great strides are being made and the discovery of grid based storage at economical cost will be a game changer.

Another reason to promote RE sources is energy independence. If countries that are not in the Middle East could survive on domestic production and renewable sources, the politics of the world would change dramatically, and the price of energy would drop, spawning another economic boom. At present, the US public is crying about high gasoline prices caused by geopolitical issues, but at the same time complaining about subsidies for renewable sources aimed at developing solutions to this issue. And blaming Obama for both.

Let's make this very clear. Oil will get more and more expensive until it runs out, the planet will warm in the mean time from CO2, and there will be instability in the Middle East and Venezuela. Or you can believe the Forbes and Fox News stories that tell you the opposite.

I live in a country that has probably the highest electricity costs in the world, 43c/KWh, unlimited sunshine, and refuses to allow people to install solar. Figure that policy out. Very soon we will not be a viable state because of high energy costs, but there is still no vision or will to move out of the dark ages.

Be glad you at least have the right to install solar or wind or whatever.

Without subsidies this market probably wouldn't exist. Solar is massively expensive per watt relative to other sources of energy. Unless you taxed the heck out of them you would just end up with more dirty energy and little to no solar at all.

However, dumping doesn't make sense here. Properly maintained, a solar installation can reliably last for many decades with only minimal replacement.

Dumping exists to cause a mad rush of adoption, to set the hook for lock in. If adoption also translates to reduced demand later (see eg, computer sales figures from 1990 to today for an indicator of saturation with durable goods), then dumping makes significantly less sense.

More likely, china is trying to bolster capital to rapidly develop a thriving industrial production infrastructure, and the current situation provides a ripe opportunity who's time has come.

The US populace *DESPERATELY* wants to be rid of expensive and toxic fossil fuel use. So much so that they are willing to break the bank on one-off investments on domestic solar. (Something highly uncharacteristic of the typical us consumer's demographic profile)

China says "we can make solar cells for you! We can make them DIRT cheap!"

US consumers shout "SOLD!"

US regulators go "Oh No! OMGWTF! If they all switch to solar, we won't have as many reasons to stay in a state of purpetual war with the middle east, and our out-of-channel campaign funding sources will diminish! This is terrible! We have to act! We have to drive the prices of these deleterious cheap solar installs back up to protect our interests!"

So, they institute tarrifs to drive the prices up, in the hopes of preventing widespread solar adoption.

I would bet dollars to holes in doughnuts that the leading voices behind the tarrifs have memberships in the GOP, and hold shares in energy companies.

Obama's "Green" initiatives are about more than implementing a renewable technology such as solar. Just as important in that imitative is "Green Jobs". It is seen as a twofer, ween us off the eeeevil oil and bring manufacturing jobs back.

The reality is that most of that 21 billion was heavily subsidized by the tax payers, the purchase, the manufacturing and the installation. China is undercutting all of the domestic manufacturers by doing the same thing. It's kind of ironic that we subsidized our solar industry but now they want tariffs because China does the same thing, only much more.

In the end, the tariffs are a last ditch effort to salvage the whole green jobs thing.

Obama's "Green" initiatives are about more than implementing a renewable technology such as solar. Just as important in that imitative is "Green Jobs". It is seen as a twofer, ween us off the eeeevil oil and bring manufacturing jobs back.

The reality is that most of that 21 billion was heavily subsidized by the tax payers, the purchase, the manufacturing and the installation.

You say that as if it is some kind of dirty secret. But isn't this what the Obama administration has been saying explicitly from the start? And why would they be ashamed of it? It sounds to me like a good investment of public money.

Because we just paid good money (a few billion here, and a few billion there), using a loan with an significant interest rate (which will be counted as an asset, and never repaid), for an industry which will not profit, and I mean that in a more than monetary sense, its investors (it will neither provide the long-term jobs as promised, nor increase the absolute wealth of those involved, nor help in any meaningful way to achieve a sustainable 'green' agenda). It shows a supreme lack of vision (we'll talk solar when the efficiency of those cells increases to a competitive level with other technologies and the energy storage problem is solved), understanding of human nature (who didn't think the Chinese would steamroll this industry?), economics (spending money to make money, only not), and science (do we do that anymore? I see lots of paper, journals, publications, yet nothing noteworthy).

And yes, I am mindful that past presidents have also acted in an equally foolish capacity. However, that does not excuse the current guy; let's try to hold them to a higher standard from now on, right?

Finally, I feel as if I am watching an heir of an empire burn through his / her money, because "there will always be more." A little less the lovable eccentric who occasionally hits on a brilliant idea that leaves others questioning whether he / she is really insane, or just brighter than them (and keep said eccentric far enough in the black that his / her feet never really touch ground); a little more the loud, annoying frat kid whose father owns a car dealership, so it's cool to keep spending, because people always need cars, right?

What was the interest rate, if it was so significant? I thought the government was currently able to borrow money for less than the rate of inflation, or nearly so.

And in our current situation, we SHOULD be borrowing/printing, and spending. The economy is underperforming, people are unemployed, and have been for some time. When the economy is healthy again (as it was during the latter Clinton years) we can run surpluses and balance the budget.

We were doing just fine (with our surplus) till we got the bright idea to (s)elect Bush. What you describe most nearly fits the (recent-decades) Republican approach to government deficits. As recently as Bush-the-elder, Republicans were somewhat more responsible in their approach to taxing and spending. (Yeah, you can tell where my sympathies are, but I think I am merely recounting history with a healthy dollop of snark.)

Note that we have been at war since 2003 with no substantial tax increases the entire time - unlike all of the major wars the US participated in during the 20th century. I'm not advocating government waste, but a huge part of our current deficit problem is that in these two wars, for the first time in over a hundred years, the government decided to fund it entirely by borrowing.

Also consider that we were in a recession that was arguably a depression, and just about any way to rapidly pump money into

Obama's "Green" initiatives are about more than implementing a renewable technology such as solar. Just as important in that imitative is "Green Jobs". It is seen as a twofer, ween us off the eeeevil oil and bring manufacturing jobs back.

The reality is that most of that 21 billion was heavily subsidized by the tax payers, the purchase, the manufacturing and the installation.

You say that as if it is some kind of dirty secret. But isn't this what the Obama administration has been saying explicitly from the start? And why would they be ashamed of it? It sounds to me like a good investment of public money.

If it's a good investment, if it's actually "booming", it shouldn't need public money.

No one is claiming that Obama has been quiet about being bullish on green jobs / energy. The dirty secret is that the press has played up these numbers that are wildly inflated by federal spending. The dirty secret is the number of Obama campaign contributors who got this money.

And this is a symptom of the continuing problem with Keynesianism in the modern economy: in the past, the government could dump a ton of money into the economy and investors would believe that there was going to be a lasting surge in demand, and they would invest assuming that it would last. That additional investment would outweigh the contraction in GDP after the stimulus ceased. But now, with the Web and a deluge of financial information, investors know exactly when the economy will contract after the stimulus ends, so they don't make long term investments, and the contraction after the stimulus ends is even worse. This is what we're seeing with the green stimulus falling apart.

In the end, the tariffs are a last ditch effort to salvage the whole green jobs thing.

Except this backlash isn't exclusive to the USA.

"Here is a pair of graphs that demonstrate most vividly the merit order effect and the impact that solar is having on electricity prices in Germany; and why utilities there and elsewhere are desperate to try to rein in the growth of solar PV in Europe. It may also explain why Australian generators are fighting so hard against the extension of feed-in tariffs in this country."

It's not good for those natural gas/diesel plants, as well as coal plants, all whom have enormous capex costs they're locked into.

Would you want to be a nuclear power plant owner, with ~$1 billion sunk into your facility if someone invents (for the sake of argument) an arc reactor that fits in the palm of your hand and generates all the power you'll need for months at a time in a few seconds?

Except solyndra was about payback for democratic political donors rather than developing tech.

If they really want to spur domestic production they should simply tie any subsidies or tax breaks for solar installations to using US made products. The chinese are deliberately trying to crush manufacturers of everything in the US. It's economic warfare and they're winning because we aren't even trying to play.

Taxing the chinese products is more proof that obama and the dems have absolutely no idea how to handl

Taxing the chinese products is more proof that obama and the dems have absolutely no idea how to handle the economy.

It's actually a pretty standard response to an unfair subsidy: China pays $X to reduce the cost of Chinese solar panels, we charge $X in taxes to offset the subsidy and destroy the unfair competitive advantage. And China then loses all incentive to continue the subsidy, because the money isn't actually going to their solar industry anymore, it's just going to pay the tariff which would be eliminated if they stopped paying the subsidy.

Of course, the smart thing to do would be to impose a tariff on Chinese solar panels which doesn't capture the entire subsidy, and then pay the money collected to the domestic manufacturers to eliminate the competitive advantage created by the remainder of the subsidy which isn't collected as a tariff. The consequence is that China is then subsidizing world-wide, rather than only Chinese, manufacturing of solar panels. That's a good thing.

And, if you want to be strategic, make it known that you won't discontinue this arrangement until few years after China discontinues the subsidy, to give them an incentive to keep it -- since discontinuing the subsidy would then make their solar manufacturing totally uncompetitive for a few years, but keeping it (and thereby subsidizing everyone) would leave their industry on the same playing field as they would have been if they didn't decide to play this game in the first place.

Except that China doesn't pay that tariff - the US importer pays the tariff. That's how tariffs are assessed in the US - on the entity bringing that product into the US. Now, increasing the tariff can make it harder for the US importer - because his costs are higher. But unless that negatively impacts his sales, it in no way damages or monetarily impacts the Chinese manufacturer - it only taxes and lowers the profit of the US importer.

You guys make me laugh. Even if a hand full of companies employ local workers and produce at competitive prices to the Chinese what makes you think these companies won't in turn out source those jobs to China to become "More Profitable(TM)"?

Common guys lets sit down and think about this for a second. The middle class makes money via manufacturing. People who own these companies make money by giving your money to the Chinese to do the same work for a whole lot less, with the added benefit of not having to see how the sausage is made.

Even if one company attains this insurmountable goal and eventually goes public, then by their responsibility to their shareholders alone they will be obligated to fire every one and send the work out east. So stop it with this stupid pipe dream and find something the Chinese CAN'T do at a fraction of the cost and work up from there. Trying to fantasize you can make a dead simple polymer sheet cheaper than the Chinese is just not going to happen.

(Although labor is not nearly as large a component in the solar industry as it is in others, the process is largely hands off automated machinery).

But a good portion of the problem is also the US corporate tax rate. [cnn.com] US corporate tax rate is about 40%, China is about 25%. Everybody likes to bitch about obscene corporate profits and how little they pay in taxes and then wonders why they ship jobs overseas.

You're burying the lead here guys. The tarrif is supposedly in response to unfair competition (dumping) - not the larger underlying issues of endemic competitive advantages / disadvantages. Equally good and valid discussion but here the larger issue seems to be - is the capability to produce "green" energy sources from within the country crucial enough to protect at the expense of the taxpayers.

or Rich Dude underpays his workers and uses an economically damaging manufacturing method. Rich Dude funds a "social welfare" group that lobbies for corporate "freedom". Things that will "level the playing field with other countries", like disbanding the EPA, or doing away with minimum wage. His accountants decide that these are necessary business expenses and tax deductible, it doesn't hurt that the organization he is donating to has no legal requirement to disclose donors.

Rich Dude's company banks the rest of his money to buy out competitors or seal up exclusive contracts with suppliers. Money in the bank gives him a pop star status and allows his company to throw lavish business conferences (for tax puposes) that happen to coincide with his birthday or his wife's. Rich Dude is able to borrow against the equity in his business and take a $1 a year salary, make it 50k if your not Steve Jobs. Rich Dude's vacations include stops to visit customers and become business expenses.

Meanwhile Rich Dude's money is being hoarded by his bank who is afraid to loan too much in this business climate. Workers (Rich Dude's) don't make enough to pay back loans. The bank eventually decides to loan the money out anyway and package the loans up so suckers will buy them as investments. Or the bank buys credit default insurance. The bank eventually crashes the world economy and that "social welfare" group I mentioned above uses the bad economy to convince people to make sweeping changes to regulations and laws. The country stagnates. Rich Dude can't figure out where his customers went, so he retires to 3rd world country and lives in luxury for the rest of his days.

Changing the people in power is incredibly difficult. Those who would best run the country will not run for office. Those that run are not fit for office. That leaves us with people who are all about "collaboration" -- that is the people who honestly believe that reality is whatever the consensus says it is. pi=3 is good enough... Consensus builders have no patience for cold hard facts.

There is all this nonsense talk about how oil industry is getting 'subsidies', while in reality those so called 'subsidies' are just deductions in tax payments that the oil companies make, all while the real subsidies is money that the gov't wastes giving uninsured loans or just straight money to all these 'alternative energy' companies

And yet the subsidies that the fossil fuel companies get are above and beyond what the alternative energy groups get.

By the way, Obama believes he is a great genius of a businessman, why is he not using his own money to sponsor all these 'alternative energy' companies but insists on spending other people's money on this?

Figure out how long it would take to replace oil based energy input to society with solar electric energy, and stand in awe. Also don't hold your breath. Feel free to assume that solar cells are 100% efficient.